The offender is to be sentenced having pleaded guilty to the following offence: that between 14 October 2008 and 4 September 2009 at Plumpton, Colebee and elsewhere she did by deception dishonestly obtain a financial advantage, namely the age pension belonging to another, namely, the Commonwealth, being a Commonwealth entity. That is an offence under s 134.2(1) of the Commonwealth Criminal Code and has a maximum penalty of ten years imprisonment and/or a fine equivalent to 600 penalty units. The offence is a Commonwealth offence and the offender is to be sentenced in accordance with the provisions of Part 1B of the Commonwealth Crimes Act
[2]
The Facts
The facts are agreed and the following is taken from the agreed facts. Angela Cappoli was the grandmother of the offender. Ms Cappoli was in receipt of the aged pension on a fortnightly basis from the Department of Human Services Centrelink, which I will refer to as the 'Department', from 20 March 1997. The aged pension is payable to eligible persons who meet residency requirements and have reached the relevant age for eligibility. The offender became a correspondence nominee for her grandmother on 20 March 1997, which authorised her to enquire and make changes to her grandmother's Departmental records. The offender retained this authority until payments were cancelled on 2 September 2019.
Between 14 October 2008 and 4 September 2019 the offender represented to the Department that her grandmother was resident in Australia. However her grandmother departed Australia on 3 December 2007 and never returned. In addition, the offender's grandmother passed away on 25 May 2015 in the Philippines. The offender attended her funeral in that location. Between 14 October 2008 and 4 September 2019 the offender's grandmother's aged pension payments were paid into a Commonwealth Bank Account held in her name. The offender was authorised to operate the account from 8 July 1999 and on 27 September 2012 the offender had possession of the debit Mastercard linked to the account in her grandmother's name.
Transaction records from the Commonwealth Bank of Australia bank account show most of the funds were either withdrawn or disposed of in Australia soon after payment. There is apparently CCTV footage on 21 August 2019 which shows the offender withdrawing funds from her grandmother's account. On 15 January 2004 the offender contacted the Department by phone to enquire about what would happen to the grandmother's payment after she passed away. The offender was advised that her grandmother's estate was not entitled to payments after her death and her payments would therefore need to be cancelled on the day following her death. The offender was advised that any payments after this date would result in an overpayment raised against her grandmother's estate.
On 26 November 2007, the offender contacted the Department by phone and advised that her grandmother would be travelling to the Philippines on 3 December 2007. The offender was advised that her grandmother would be eligible to continue receiving payments of the aged pension whilst outside of Australia until 2 June 2008 and that if she had not returned by that date the payments would be cancelled. The offender advised that she expected her grandmother to return some time between 3 March 2008 and 2 June 2008. On 10 October 2008 and 29 April 2009 the offender completed and signed a Departmental form entitled "Rent Certificates" The rent certificates advised that her grandmother was residing at an address in Plumpton and paying $100 per week in rent to the offender who resided at the same premises. Attached to the rent certificates were letters written by the offender dated 10 October 2008 and 26 April 2009 confirming her grandmother paid her $100 per week for board and lodging. The signed letter stated "I have affixed my signature below as confirmation of my declaration".
On 2 June 2008 the Department suspended the offender's grandmother's aged pension payments as they had not received information that the grandmother had returned to Australia. On 12 August 2008 an unknown person contacted the Department by phone to advise that the offender's grandmother returned to Australia and the Department reinstated the grandmother's payment.
On 19 February 2010, 4 February 2013 and 17 May 2019 the offender advised the Department that her grandmother would be travelling to the Philippines including details of the dates of departure and of returning to Australia. Also between 28 December 2007 and 14 May 2017 the offender on 15 occasions contacted the Department and requested an advanced payment on behalf of her grandmother.
The offending was detected on 6 August 2019 following a review of Department customers which identified the grandmother was over 100 years of age. When a search warrant was issued on the offender's premises on 13 March 2019 she exercised her right not to take part in a record of interview
[3]
Objective seriousness
Turning then to my assessment of the objective seriousness of the offence. The offending here occurred over a period of approximately 10 years and eleven months, a significant period of time. The amount of money defrauded is $230,131.58, nearly a quarter of a million dollars, a very substantial sum of money. Only $10,621 has been repaid to the Commonwealth as at this point in time. It is clear from the agreed facts that the offender knew throughout the offence period that the pension was no longer payable to her grandmother once her grandmother ceased to be a resident of Australia after 2 June 2008. It is also clear that the offender knew throughout the offence period that the pension was no longer payable to her grandmother's estate once her grandmother had passed away. The offender's grandmother left Australia on 3 December 2007 and never returned. Her grandmother passed away in the Philippines on 25 May 2015. A number of false representations were made over the years in order for the offender to continue the fraud for such a significant period.
On 10 October 2008 and 29 April 2009 those representations were in writing advising the relevant Commonwealth agency of the supposed address of the grandmother and confirming that the grandmother was paying rent in order to stay at those premises. On 14 February 2010 and 4 February 2013 the offender advised the relevant government agency that her grandmother would be travelling to the Philippines, something which she knew to be false including providing dates of departure and return.
The offender did the same thing on 17 May 2017 which was a particularly egregious false representation in my view because the grandmother had passed away by that time. The offending only came to light when the agency concerned realised the offender's grandmother would be over 100 years of age if still alive. This offence is a serious offence. While it does not have a significant degree of planning attached to it, I do consider it should not be seen simply as opportunistic. It may have been to some degree opportunistic at the start, but as the offending went on there was a degree of planning involved given the nature of the false representations that were made to the relevant government agency. I assess the objective seriousness of this offence as being a little below a notional midrange of objective seriousness for offences of this type.
[4]
The offender's subjective case
The offender was born in Manilla in the Philippines on 16 May 1966 and is 55 years of age. She has no criminal history. The evidence in her subjective case establishes that she is also a person of prior good character. Both of those facts result in the offender being entitled to some leniency in this sentence.
[5]
Documentary material
Turning then to the offender's subjective case. In terms of documentary material I have before me a Sentencing Assessment Report dated 15 September 2021; a psychological report of Anita Duffy, dated 6 September 2021; a psychological report of Jayne Cat, dated 31 August 2021; a letter from Dr Julie Ong, dated 1 September 2021; a letter from Julie Banfield, dated 31 August 2021; a letter from Kathy Abolin dated 31 August 2021; a letter from Pablo Sarza, the offender's husband, dated 1 September 2021; a letter from Mark Henson, dated 10 September 2021; a letter from Sharryn Widdowson, dated 10 September, 2021; a letter from Sue Gunning, dated 16 August 2021 and a letter from Aaron Gravino, dated 26 July 2021. The offender did not give evidence on sentence and I have had regard to that fact in assessing what she told the report writers, in particular about the commission of the offence.
[6]
Family background
In terms of her family background, according to Ms Duffy the offender grew up in the Philippines with her maternal grandmother and her mother's siblings. Ms Duffy's report recalls that the offender grew up in relative poverty. The offender's father died when she was a baby and her mother who gave birth to the offender when she was 16 years old worked often and was frequently absent. The offender regards her grandmother as her maternal figure. Ms Duffy's report records that the offender was married in 1988 having moved to Australia and at the time her grandmother lived with her and her husband. The offender has three children who are now all adults although two live with the offender and her husband. The offender's grandmother stayed with the family until her return to the Philippines in 2007. The offender's grandmother passed away, as I said earlier, in 2015 and the offender was greatly affected by that loss.
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Education and employment history
In terms of her education and employment history the offender told Ms Duffy that her mother sent her to a relatively prestigious high school in Manilla in order to obtain a good education. However, the offender described being bullied and feeling humiliated and ostracized from her classmates due to the difference in her socioeconomic background. The offender completed the equivalent of Year 12. The offender told Ms Duffy that she then attended college or university where the offender began a computer based course which she did not finish as she moved to Australia. According to Ms Duffy the offender was able to "escape from her poverty" by moving permanently to Australia in 1988 shortly after her mother and grandmother had moved here. The offender told Ms Duffy, "She was able to enjoy the relative equality in Australian society".
The offender reportedly joined her mother as a kitchen hand at Royal Prince Alfred Hospital and then worked in the Commonwealth Bank's printing company. She later worked various jobs in between the birth of her children including at McDonalds and Star City and from 2003 to 2018 at Woolworths. According to Ms Duffy, "Her boss has been very supportive of her since her offence came to light in September 2019". There are testimonials from fellow workers before me attesting to the offender being a diligent and reliable worker while working at Woolworths. According to Ms Duffy the offender cannot work at present during the Covid-19 restrictions as she cannot wear a mask all day due to her asthma.
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Substance use
In terms of any substance use issues, the offender told Ms Duffy that she does not drink or smoke and has never used illicit drugs or overused prescribed medication.
[9]
Psychological/psychiatric history
Turning to the offender's psychological history, according to Ms Duffy, following her grandmother's death the offender was referred to a psychologist for bereavement counselling. The offender was prescribed an antidepressant and saw a psychologist in Blacktown for six sessions. Whilst her 'gambling habit' on the poker machines, a clear problem for the offender on the evidence, remained undisclosed at that time, it is clear that she has since sought effective treatment. The offender was introduced to gambling by her friends in a social setting, however following those early bets she began to attend RSLs alone after work. According to Ms Duffy, by 2013 to 2014 the offender was gambling regularly every pay day on Wednesdays. The offender would put her wage through the machines and if she lost she borrowed money from "Loan sharks" or went to cash converters to be able to buy food. After her grandmother's death the offender used the grandmother's pension to gamble in addition to her weekly wages. The offender estimated that she had lost hundreds of thousands of dollars to gambling over the years.
Ms Duffy's report records that following the police search of her house and subsequent charging in September 2019 the offender began seeing a counsellor at Wesley Mission Gambling Counselling Services and saw him on a weekly basis up to the present. The offender reportedly found his input extremely valuable and intends to maintain the contact. The offender was referred to a psychologist Jayne Cat in December 2020 by her GP Dr Ong. According to Ms Cat's report, the offender matches the criteria of the DSM5 of Severe Gambling Disorder in early remission, mild Major Depressive Disorder and Severe Generalised Anxiety Disorder. Ms Duffy similarly opined that the offender had satisfied the diagnostic criteria of Gambling Disorder, severe, persistent and in sustained remission, and persistent Depressive Disorder. Ms Cat opined that the gambling addiction arose from the release of dopamine and serotonin which gave the offender temporary relief from her depression and anxiety. Ms Cat reported that the offender has not gambled since September 2019 and did not show any signs of potential relapse.
The offender has also recently participated in other treatment programs including the Positive Lifestyles Program conducted by the Salvation Army, a six week Group Life Choice Program conducted by Oakdene House, Fairfield and attending Gamblers Anonymous meetings either in person or via zoom in lockdown. Ms Duffy opined that the offender: "Has made great progress in her rehabilitation to get the help she needed to stop and does not want to spoil the advances she has made".
The material satisfies me that the offender has embarked upon considerable rehabilitation insofar as her gambling addiction is concerned. It is regrettable that she did not commence treatment for that addiction until after she was arrested for such significant offending. I will return to the relevance of the offender's gambling to her sentence shortly.
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Attitude to the offence
Turning then to the offender's attitude to the offence. Ms Cat reported that throughout her therapy sessions the offender expressed significant regret and remorse for her offending. The offender reportedly often broke down when she expressed the shame for what she had done. This is supported by Mr Gravino, the offender's gambling counsellor, who noted that the offender disclosed her offending in their first sessions in 2019 and expressed her remorse and regret for what she had done and who she had hurt in the process.
The offender's remorse is also referred to in the report of Ms Gunning, the senior financial counsellor with the Wesley Mission. According to the Sentencing Assessment Report the offender appeared to take responsibility for her actions. According to Ms Gunning, the offender had budgeted that as from 18 December 2020, the offender would put away $50 per week into a "restation" account. As of 9 August 2021 the balance of that account was reportedly $3,200 and this was in addition to the fortnightly deductions of $238 which she is paying directly to Centrelink
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The future and risk of re-offending
According to the Sentencing Assessment Report the offender has been assessed as a low risk of reoffending and Ms Duffy arrived at the same level of risk of reoffending.
[12]
Imposition of sentence
The offender's plea of guilty was entered in the Local Court. Under s 16A(2)(g) of the Crimes Act I am to have regard to the fact of the plea, its timing and the degree to which those facts resulted in any benefit in the community. I note that it is appropriate to have regard to the utilitarian benefit of a plea of guilty when sentencing for a Commonwealth offence. I propose in the circumstances here to allow the offender a twenty-five percent discount off her sentence for the utilitarian value of her plea. The offender's plea of guilty, together with her statements of remorse and contrition to the report writers satisfies me she has genuine remorse for her offence.
To a significant degree her offending is linked to her gambling addiction although there is evidence in Ms Duffy's report that while her grandmother was alive she sent some of the money illegally obtained from the Commonwealth to her grandmother overseas. It appears on her own account to Ms Duffy that it was only after her grandmother passed away that she used the whole of the money the subject of the offence to gamble. To the extent that her offence is linked to her gambling addiction, the evidence establishes that since being charged with the offence she has engaged in significant rehabilitation. The evidence also is to the effect that she has a low risk of reoffending. The offender also has a supportive family and a history of gainful employment. In these circumstances she has excellent prospects of rehabilitation.
As I just indicated there is evidence that not all of the funds obtained from the offence was spent on gambling although I accept her gambling addiction had a significant role in her offending. The Court of Criminal Appeal in Johnston v R [2017] NSWCCA 53 considered the relevance of a gambling addiction to sentencing. In general, the fact that offences were committed to feed a gambling addiction will not be a mitigating factor on sentence. Although a gambling habit may explain why someone engaged in criminal conduct, it is a rare case where the offender can seek mitigation of the penalty based on an addiction to gambling even when the addiction is found to be pathological. Where the offence is committed over an extended period of time, there is generally no reduction in moral culpability due to a gambling addiction as the offender had a degree of choice as to how they funded the addiction. There is nothing in the evidence here to suggest that this offender lacked the capacity to exercise judgment.
As I noted earlier it is clear that at least in the early years of the fraud, not all of the funds obtained as a consequence of it were spent on gambling. I do not consider here that the fact the offence in part was motivated by the offender's gambling habit mitigates the sentence in any way. Nor do I consider that the principles concerning the relevance of mental health to sentencing contained in cases such as Director of Public Prosecutions (Cth) v De La Rosa [2010] NSWCCA 194 are engaged here so as to mitigate the sentence.
I am sentencing the offender during the re‑emergence of the Covid‑19 pandemic. The Public Health Orders mean that there will be no in person visits in the gaol system it would seem until the Public Health Orders change. It is known to the Court that the disease has entered the prison population although I do not know if it has entered the female prison population. Clearly the disease presents a very real difficulty for those charged with the responsibility of keeping inmates safe. It is likely that the conditions of custody will be more arduous as a consequence of the pandemic. I also consider anyone entering custody during this time is likely to have a heightened level of anxiety in relation to the disease. I have had regard to those factors in determining the appropriate sentence.
The Courts have long said that significant penalties must be imposed on those who commit fraud on the system of social security payments that is provided by the Australian government. The system of social security in this country is generally directed to those who are less well off in our society and must remain a system whereby access is relatively easy for people. It is a system that relies heavily upon the honesty of those who apply for social security benefits so that access to the system can remain relatively easy. Frauds, like the offender's conduct here, undermine the social security system and the burden of such frauds falls on all Australian taxpayers who fund the system. General deterrence, that is, the need to impose a significant penalty not just to deter this offender but to deter others remains an important principle to give weight to when sentencing for such an offence.
I have considered the cases to which the Crown and the offender's counsel referred me to. No two cases are ever the same and it was not suggested that the cases establish a sentencing range but they do provide some assistance here in determining the appropriate sentence to impose. Sentencing as always remains a task of instinctive synthesis often having regard to different relevant objectives of that task which pull in different directions. I have determined in accordance with s 17A of the Crimes Act that no sentence other than a sentence of imprisonment is appropriate here. The maximum penalty has been taken into account as a legislative guidepost.
I was asked to consider imposing a sentence which would allow the offender to serve the sentence in the community by way of an Intensive Correction Order. It will shortly be seen that I consider the appropriate sentence to be one of more than two years and hence that sentencing option is not available. Even if I had been of the view that a sentence of two years or less was appropriate in my opinion general deterrence would require that a sentence of full time custody should be imposed for such a serious offence.
Please stand up Ms Sarza. You are convicted of the offence of obtaining by deception a financial advantage. I impose a sentence of two years and three months imprisonment. The sentence commences today on 24 September 2021 and expires on 23 December 2023. I make a Recognisance Release Order under s 19A C and s 20 of the Crimes Act and order that the offender be released on a recognisance after serving 13 months of the sentence being 23 October 2022. The Recognisance Release Order is in the amount of $100 without surety and it is a condition that the offender is to be of good behaviour for a period of two years. If you fail to comply with that condition and commit a further offence, further action can be taken against you.
The offender Ms Sarza will now need to go into custody and will be released on 23 October 2022 on the recognisance I just announced. I make a reparation order under s 21B of the Crimes Act that the offender pay to the Commonwealth the amount of $219,510.58 being the amount I was advised was outstanding in relation to her fraud.
[13]
Orders
1. The offender is convicted of the offence to which she pleaded guilty
2. Impose a sentence of two years and three months imprisonment. The sentence commences today on 24 September 2021 and expires on 23 December 2023.
3. Make Recognisance Release Order under s 19A, 19C and s 20 of the Crimes Act and order that the offender be released on a recognisance after serving 13 months of the sentence being 23 October 2022.
4. The Recognisance Release Order is in the amount of $100 without surety and it is a condition that the offender is to be of good behaviour for a period of two years.
[14]
Amendments
22 November 2021 - Removed offender's first name from title
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Decision last updated: 22 November 2021